Do you have unclaimed money? Posted on: April 27, 2017

Summary:

In Australia, there is approximately $1.1 billion dollars of money waiting to be claimed. Of course, this doesn’t mean ‘first in first served’, but it’s possible that some of the unclaimed cash is yours. The reason for all this unclaimed money is because people sometimes lose track of their money. This could be due to a variety of different reasons such as moving often, moving overseas or simply just forgetting. If you think there’s a possibility that you have any unclaimed money in Australia, you can check ASIC’s MoneySmart Unclaimed Money search tool.

In a Nutshell:

  • There is approximately $1.1 billion dollars of unclaimed money in Australia
  • People occasionally lose track of their money due to moving often, moving overseas or simply forgetting.
  • ASIC's MoneySmart Unclaimed Money search tool can help you reunite with money you may have lost.

Read On: Australia's Unclaimed Money, by MoneySmart:

Credits:

MoneySmart

ASIC

www.moneysmart.gov.au

Low-cost ways to give your apartment a makeover Posted on: April 22, 2017

Low-cost ways to give your apartment a makeover

If your apartment is looking a bit tired but you think renovations will be difficult – not to mention expensive – you might be surprised at how easy it is to give a small space a big makeover.

Whether you're preparing to sell or rent your property, or you just feel like a fresh look, renovating an apartment can be rewarding. Apartments and units generally have smaller spaces than houses, so a revamp is your chance to think creatively.

Remember, we’re not talking major work here – external changes or major structural work like knocking out a wall could come at significant cost and will probably need approval from the owners’ corporation. Instead, think colour, texture, space and clever design.

Light and large

One of the easiest ways to spruce up your apartment is with a bright new coat of paint. Consider white paint or soft neutrals to make the space feel lighter and larger. If you don’t think the entire place needs a full repaint, just give the walls a good clean and touch up high-traffic areas.

The living room

Your choice of flooring can make a major difference to the look and feel of the apartment. If the carpet is looking a bit worn, you can either replace it with something lighter in colour to increase the feeling of open space, or go all out with floorboards. For a quicker upgrade, buy a bright new rug.

Window treatments can also dramatically affect the mood of a living room. Experiment with curtain and blind colours and levels of opacity, and position the curtain rail higher than the windows if you want your ceilings to appear taller.

When you need an instant change, don’t underestimate the impact of colourful new cushions for the couch. Think about linking colour accents for a whole new feel.

The bathroom

When it comes to the bathroom, the important thing is to make it shine. Start by scrubbing the entire bathroom – it’s the easiest way to freshen the room. You can then brighten the walls with a crisp white mould-resistant paint, and disguise old-fashioned tiles with tile paint. If your bathtub is looking grimy, give it a lift with paint designed specifically for ceramic surfaces.

For some simple, low-cost fixes, replace that icky shower curtain with a lavish designer one (shop around online – there are some striking designs that can easily add a pop of colour to the room) and buy a gleaming new water-saving showerhead. Hang a wall mirror in smaller bathrooms to create the illusion of space.


Small fixtures can make a surprising difference – replace outdated towel rails with something contemporary or uniquely vintage, install new taps, and change the knobs on your cabinets. Again, shop around online, as there are some amazing designs out there.

The kitchen

A quick way to update your kitchen is with new cupboard handles and modern tapware. If you’re short on space, get creative with storage options – an island bench on wheels can also store your pots and pans, or sculptural shelves can make the most of overhead space. Is your knife block taking over the bench space? Screw a magnetic knife strip to the wall.

The bedroom

This one is easy. Grab yourself some fresh new bed linen and revitalise the colour scheme with decorative accents like rugs and cushions. But more than anything, get your mood lighting on. Soft wattage bulbs create a snuggly ambience, while pendants and floor lamps can provide relaxing lighting options.

It doesn’t take much to put a little pep into a property – a lick of paint, a splash of colour, a crisp new bedspread. These simple updates can be made quickly, and on a budget, so why not give your apartment the DIY treatment this weekend?

Want to help your kids buy property? Here’s how! Posted on: April 20, 2017

The real estate market can be tough for young adults, but as a parent you may be able to lend a helping hand. We tell you how.

1.Parent-to-child loan

A parent-to-child loan is when a parent lends their child money. This is a formal, legally binding arrangement, administered by an independent third party. At the start of the loan period, both parties agree to terms including repayment amounts, a schedule and a process to manage defaults.

Benefits: You can set generous terms for your child, but your assets, savings and credit rating are somewhat protected as you are not the borrower.

Drawbacks: There are legal implications for your child if they have a spouse and the relationship breaks down, in that the spouse could try to claim some of the loan proceeds as an asset of the relationship to which they are entitled. There are also tax considerations for both parties.

2.Family guarantee

If your child doesn’t have enough security for a mortgage, you could provide a family guarantee. This is where you use some of the equity in your own home as part of the security. For example, your equity might cover 20% of the security, and your child’s new property would be the other 80%. It’s also known as a guarantor loan.

This can be a temporary arrangement until your child has paid down the loan to an acceptable level.

Benefits: You have the option of guaranteeing only a portion of the loan.

Drawbacks: If your child defaults, your assets are at risk.

3.Becoming a co-applicant

You can help your child secure a loan if you sign on as a co-applicant. This means you’re equally as responsible as your child for meeting repayments. The lender will consider your assets in its borrower's assessment.

Benefits: Your child can obtain a loan with a low income.

Drawbacks: If your child stops making repayments, you’re responsible for making them. If you can’t make the repayments, it will affect your credit rating.


4.Gift

When you give your child money but don’t expect it to be repaid, it’s considered a gift. You may need to sign a statement to say it’s a gift, not a loan.

Benefits: You can provide financial help, possibly without the legal, tax or financial implications of a formal arrangement.

Drawbacks: If your child has a spouse and their relationship breaks down, the former partner could make a claim for the property.

5.Assistance in kind

If you're risk averse, consider providing assistance in kind; that is, covering some of the expenses that come along with buying a property. You could pay for services such as a property survey or conveyancing fees, or help with stamp duty.

Benefits: You can give practical financial assistance.

Drawbacks: The amount of money you provide may be more than what your child ends up spending. For example, you might want to contribute $20,000 but the services cost

$15,000. In this case, the rest of the amount is subject to the terms of a gift or loan.

Make sure you're well informed about your options when giving or lending money so you can remain in the best position to help your child become a home owner. You can contact your mortgage broker to discuss the right financial arrangement for your family.

The Australian Share Market Amid Korea Tensions Posted on: April 18, 2017

Summary: 

Tensions between the US and North Korea have had an effect on international markets, resulting in the Australian share market opening lower. Worries about North Korea as well as the run-up to the French election are contributing to this decline. The change of a Marie Le Pen election victory in France may result in implications within the European Union which could affect international markets.

Despite this fear, some believe that the Australian dollar had proven to be quite resilient despite geopolitical concerns.

In a Nutshell:

  • Tensions between the US and North Korea are having an effect on the international markets.
  • The possibility of Marie Le Pen being elected as president of France could have a negative effect on the global markets.
  • Despite fears, some believe that the Australian dollar can withstand most geopolitical concerns.

Read On: Australian share market set to open lower amid Korea tensions, by Tom Rabe:

Brewing tensions between the US and North Korea are weighing on international markets, with the Australian sharemarket expected to open lower tomorrow.

US and European markets declined last week, followed today by markets in Asia.

The ASX is expected to follow their weak leads when it reopens tomorrow after the Easter long weekend.

“It’s largely in response to these worries about North Korea and, in the background, the run-up to the French election,” AMP Capital’s chief economist Shane Oliver said.

“Markets are pointing to about a 15 point decline at the open on Tuesday.”

With relatively little economic data emerging from Australia this week, Dr Oliver said international events would probably have the greatest bearing on the ASX.

Dr Oliver said the chance of a Marie Le Pen election victory and the implications it could have for France’s place in the European Union was beginning to stoke fear in international markets.

At home, minutes from the Reserve Bank’s last meeting will be released tomorrow, but Dr Oliver said he didn’t expect any surprises.

“I don’t know that they’ll say anything new other than reaffirm the view that the reserve bank is comfortably on hold regarding interest rates at the moment and remains concerned about the strength we’ve been seeing in the housing market.”

The iron ore price may have bottomed out following a sharp fall last week, according to Dr Oliver, although today’s Chinese GDP and economic data could have a bearing on the metal.

“It could have an impact on the iron ore price, and provided economic data is reasonably solid, then it would point to a stabilisation in the iron ore price around current levels at least,” he said.

Dr Oliver said the Australian dollar had proven to be quite resilient despite geopolitical concerns, and a stabilisation in the iron ore price may also help it settle.

“Providing the iron ore price stabilises around these levels, which I suspect will probably happen, then that might act as a bit of a support for the Aussie in the short term.”

Credits:

Tom Rabe

Journalist at The Australian

www.theaustralian.com.au

How to instill financial smarts in your kids Posted on: April 10, 2017

Worried about your kids not mastering the skills to manage their finances as adults? These tips for parents will help children develop good financial sense from a young age.

Most parents want their children to achieve the Australian dream of home ownership. The good news is that parents can actually play a key role in making this happen by teaching their kids the basics of finance and instilling good behaviours that will last a lifetime.

Starting from a young age

Children are sponges when it comes to learning, which is why starting their financial tuition from a young age makes perfect sense. Even in their earliest years, taking them shopping and paying for items with cash can allow children to quickly learn the basics of commerce and money handling. When they’re at the right age, get them involved by counting the money together. It should be fun and educational.

Saving, budgeting and spending

As children get older, parents can explain to them the concepts of saving and budgeting. This will help them understand how to save for something they really want. Involve them in opening a savings account in their name, and making regular deposits with their pocket money. Most importantly, recommend they have a savings goal in mind and explain how their balance will grow over time.

It’s also a good idea to talk about budgeting, because invariably they will be spending money at some point. A good strategy is to take them on a ‘financial tour’ of your home, showing them what particular things cost, including invisible items such as electricity. Show them the bills you receive for each, and detail how you budget for them from your own income.

The miracle of compound interest

Depositing money into a savings account is one thing, but explaining how that money can earn interest on its interest is one of the most powerful financial tools children can learn. Using ASIC’s MoneySmart calculator, show them how much they can save using a long-term strategy.

Allowances and jobs

Part of the saving process for children typically starts with them receiving pocket money, but rather than just giving them money it’s better for parents to encourage their children to get a casual job once they’re of an appropriate age. This is one way of instilling a good work ethic that can be carried forward into adulthood.


Financial transparency and investments

Older children, in their mid to late teens, can further improve their financial literacy by learning about more complex products and through practical experience. This can include teaching them about residential mortgages and how they work, and perhaps showing them data on how property prices have risen over time.

It’s also good to explain how financial markets operate, including how interest rates are set and why it’s important to shop around for the best deals. Their education may even involve following shares or investments in fixed interest products such as bonds. The more they learn, the more their confidence and experience will grow.

Being transparent and providing financial advice gained from your own experience will be invaluable to your children. Start from a young age, and continue the education process for as long as you can. Over time, involve them in what you do so they can build their own financial foundations for the future.

If you're considering helping your adult child buy a home, talk to your mortgage broker about the options available to you.

RBA Board Meeting Decision April Posted on: April 7, 2017

Summary:

At the meeting, for April the board decided to leave the cash rate unchanged at 1.50 per cent. Overall, conditions in the global economy have improved somewhat in the past few months, with both global trade and industrial production improving. Despite this, some uncertainties remain. Improvement in the global economy will provide a significant boost to Australia’s national income due to higher commodity prices.

In Australia, the economy is continuing to transition following the end of the mining investment boom. Business confidence is at or above average and non-mining business investment has risen. The unemployment rate is a little higher, and employment growth is modest. Financial institutions remain in a good position to lend.

Conditions in the housing market vary considerably around the country. Some markets have conditions that appear to be strong with prices rising. Other markets have their prices declining. Growth in rents is the slowest for two decades. Growth in household borrowing, with most used to purchase a house, continues to outpace growth in household income. Supervisory measures should help address the risks associated with high and rising levels of indebtedness.

With all this information taken into account, the Board has agreed that holding the current stance of monetary policy unchanged should be consistent with sustainable growth.

In a Nutshell:

  • Global conditions have improved somewhat in the past few months with both global trade and industrial production improving.
  • In Australia the economy is continuing to transition following the end of the mining investment boom.
  • The board has agreed that leaving the cash rate unchanged at 1.50 per cent is consistent with sustainable growth.

Read On: Statement by Philip Lowe, Governor: Monetary Policy Decision:

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

Conditions in the global economy have improved over recent months. Both global trade and industrial production have picked up. Labour markets have tightened in many countries. Above-trend growth is expected in a number of advanced economies, although uncertainties remain. In China, growth is being supported by higher spending on infrastructure and property construction. This composition of growth and the rapid increase in borrowing mean that the medium-term risks to Chinese growth remain. The improvement in the global economy has contributed to higher commodity prices, which are providing a significant boost to Australia’s national income.

Headline inflation rates have moved higher in most countries, partly reflecting the higher commodity prices. Core inflation remains low. Long-term bond yields are higher than last year, although in a historical context they remain low. Interest rates have increased in the United States and there is no longer an expectation of additional monetary easing in other major economies. Financial markets have been functioning effectively.

The Australian economy is continuing its transition following the end of the mining investment boom. Recent data are consistent with ongoing moderate growth. Most measures of business confidence are at, or above, average and non-mining business investment has risen over the past year. At the same time, some indicators of conditions in the labour market have softened recently. In particular, the unemployment rate has moved a little higher and employment growth is modest. The various forward-looking indicators still point to continued growth in employment over the period ahead. Wage growth remains slow.

The outlook continues to be supported by the low level of interest rates. Lenders have recently announced increases in mortgage rates, particularly those paid by investors. Financial institutions remain in a good position to lend. The depreciation of the exchange rate since 2013 has also assisted the economy in its transition following the mining investment boom. An appreciating exchange rate would complicate this adjustment.

Inflation remains quite low. Headline inflation is expected to pick up over the course of 2017 to be above 2 per cent. The rise in underlying inflation is expected to be a bit more gradual with growth in labour costs remaining subdued.

Conditions in the housing market continue to vary considerably around the country. In some markets, conditions are strong and prices are rising briskly. In other markets, prices are declining. In the eastern capital cities, a considerable additional supply of apartments is scheduled to come on stream over the next couple of years. Growth in rents is the slowest for two decades.

Growth in household borrowing, largely to purchase housing, continues to outpace growth in household income. By reinforcing strong lending standards, the recently announced supervisory measures should help address the risks associated with high and rising levels of indebtedness. Lenders need to ensure that the serviceability metrics that they use are appropriate for current conditions. A reduced reliance on interest-only housing loans in the Australian market would also be a positive development.

Taking account of the available information, the Board judged that holding the stance of monetary policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.

Credits:

Philip Lowe

Governor of the Reserve Bank of Australia

www.rba.gov.au

Employee Spotlight – Ellie Kloppenborg Posted on: March 31, 2017


How many years have you been with Future Assist?

I have been with Future Assist for three years – starting on the 1/04/2014.

How did you come to Future Assist?

Future Assist was my first full-time job after graduating from High School. Business & Accounting were two subjects I had further studied in my senior years, which compliments the role I have at Future Assist perfectly.

What is your specialisation and how does that support the ASAP program?

I work in the superannuation department, specialising in the setup and transition of Self-Managed Super Funds. The ASAP program allowed us to integrate new products and services for our clients which were incorporated into my everyday role.

What do you enjoy doing when you are not at work?

In my spare time, you will find me with family & friends. I enjoy the outdoors and living in South East Queensland is perfect as we have a whole coastline of things to see and do.

What things do you enjoy about your job the most?

I enjoy the diverse range of tasks I complete on an everyday basis. It allows me to keep expanding my knowledge in the superannuation and financial planning field.

What aspirations or goals do you have for the future?

I hope to further my studies in the future in financial planning and accounting which would accompany my role at Future Assist perfectly. I have learnt so much in the past three years, and I am looking forward to the future and the opportunities it may bring.

What or who has inspired you?

I would have to say that my Mum & Dad very much inspired me to always put 100% into everything you do, this way you can truly achieve your goals. They have supported me every step of the way, which I am very grateful for.

21 Conversations To Have About Money Before You Get Married Posted on:

Are wedding bells ringing for you? Are you and your partner planning on getting married? Congratulations! While it may seem tempting to forget about your finances while reciting your vows for the big day, it’s undeniable that marriage will change your financial future. Whether it’s a good change or a bad change is up to you and your partner, so while you’re deciding on that wedding cake, it might be a good idea to sit down with your significant other and discuss your financial plan together. To help with this, here are 21 conversations you should have before you say ‘I do’.

1. Consider Your Life Stage

Your financial goals may change depending on how old you and your partner are and what events are happening in your life at the time. Make sure you take your life stage into consideration when setting out a financial plan.

2. Your Money Philosophy

Do you and your partner have different philosophies when it comes to money? Perhaps you are charitable, and your partner is frugal. How will this affect your financial goals? Understanding the differences between you and your partner when it comes to money is essential for creating a financial plan which suits you both after marriage.

3. Your Relationship Goals

We all have different goals in our lives, and sometimes what we deem as a priority can create a financial burden for us. Whether you like it or not, you might find that your personal goals clash with your partner’s; therefore it is important to take this into consideration when planning your financial future together.

4. Your Current Financial Situation

What is your financial situation going into marriage? If you are getting married in a strong financial position, the transition might turn out easier. This means that if you are bringing a poor financial situation into a relationship, it might be time to consider managing your spending habits and making necessary changes to your financial plan.

5. To Join Accounts Or Not?

You may be joining your partner in marriage, but will you be joining your bank accounts? Having a shared bank account might make it easier for you and your significant other to manage your finances and save towards your goals. It may also ensure that you both contribute equally to the cost of living together.

6. Should You Buy Or Rent?

If you’re getting married, you’re probably also looking to have a new house for you and your partner; therefore it is important to consider how you’ll be going about getting your property. Utilising Australia’s First Home Buyer’s Grant is an excellent solution for breaking into the real estate market as a couple, but whether or not you and your partner will share the grant should depend on your financial situation at the time.

7. Your Daily Spending Habits

Maybe you were able to manage your spending habits while you were single, but will you be able to manage your partner’s? It’s important to get a rough estimate of you and your partner’s expenses so that you can create a suitable financial plan. Remember that, to reach your financial goals, you might need to make some compromises.

8. Identifying Assets and Liabilities

If you’re planning on getting married, it's of vital importance, to be honest about your finances with them since you don’t want any surprises after you say ‘I do’. Make sure you talk to your partner about any debt you currently have. You should also speak of any beneficiaries you have and whether or not your situation as a couple could affect this. Finally, you and your partner should talk about your current savings accounts to decide what should happen with them.

9. What About A Prenup?

If you’re planning on marrying, the last thing on your mind is probably a prenup, however discussing this with your partner could be vital for your financial future. If there are significant assets at stake or children from a previous relationship, having a prenup can be incredibly important, even if it seems completely unnecessary.

10. Retirement

For you, retirement might be a long time away; however, it’s still something you should talk about with your partner. Talking about your retirement goals with your partner is vital for creating a reliable financial plan since retirement is probably an ultimate goal. What age do you and your significant other plan on retiring and how will it affect your other financial goals?

11. Are You Prepared For De Facto?

The truth is that in Australia, some people are unable to get married. In this case, you should understand what it means to be in a de facto relationship and the many laws behind it. For a relationship legally to be considered de facto, you need to have been living with your partner for a certain amount of time. The required time may be different if there is a child involved or if one partner has made a significant contribution to the relationship, so keep this in mind.

12. Taxes

Before you get married, it’s important to talk about spousal tax returns. While there may be no immediate benefit to the returns, it could prove to be more useful for one partner to hold certain assets depending on the tax brackets at the time of marriage.

13. One Or Two Incomes?

Are you and your partner both going to be working after marriage? Will one of you decide to quit full-time employment to take care of children if you have them? Understanding how much money is coming in at the end of the day is extremely vital for forming a stable financial plan, and you should take into consideration any potential changes to income that come with married life.

14. Insurance

Insurance is necessary for any person, regardless of whether or not they’re getting married. No matter the situation you are in, you need protection, and not only to cover the breadwinner in the relationship.

15. Have You Got A Will?

Estate planning documents like these are vital for achieving success in your financial future with your partner. Before you decide to walk down the aisle with your significant other, you should discuss powers of attorney, healthcare proxies and beneficiaries. If you have children, don’t forget to include guardians for them. Make sure you update the documents about every five years as circumstances change.

16. Should You Invest

Investing with your partner can turn out to be a rewarding experience, and it should always be a comfortable one. Make sure to assess each other’s risk tolerance before you try to invest and ensure that you have a plan should the market pull back.

17. Can You Afford Kids?

For many people, with marriage comes the question, are we going to have children? Maybe you or your partner has brought a child from a previous relationship. How will you include this in your finances? Remember, on average it costs around $600,000 to raise a child to adulthood, so make sure you understand this when discussing your finances. Also, remember that a child is a big responsibility which may force one of you to quit a job to care for it.

18. Will Your Kids Ever Leave Home?

Being able to spend time with your children is great, except when they’ve spent a little too much time with you. Making sure your kids can provide for themselves and move out is critical for achieving your financial goals since caring for them can create a financial burden. When do you expect your children to leave the house for good?

19. Don’t Forget About The ‘B’ Word

It doesn’t matter who you are if you don’t budget you don’t have control over your finances. Being able to manage your income and your expenses is vital for a stable financial future, and with the advanced technology we have today, budgeting has become so easy for newly-wed couples.

20. Set Ground Rules

Rules are necessary, especially when it comes to finances because they allow you to manage day-to-day life with your partner easily. Make sure that you set some ground rules with your significant other so that you’re both on the same page when it comes to spending, budgeting and investing.

21. Get The Reinforcements In

You and your partner don’t have to be alone when planning your financial future together. Sometimes you won’t agree, and so it may be beneficial to enlist a third party such as a financial planner to help you achieve your financial goals.

The Five Biggest Property Buying Fails and How to Avoid Them Posted on: March 27, 2017

Summary:

Whether you’re an investor or a first home buyer, being able to purchase a property without any issues is important for you and your financial future. Too often do buyers purchase a property on impulse and without considering doing research, which often ends up in an unsatisfactory deal.
You should make sure to keep your emotions out of the decision to buy a property. Becoming a little too interested in a particular house for sale could cloud your judgement and may also influence the occupier and real-estate agent’s decision for a final price if they find out.

The listing price might give a general idea as to the value of the property you are looking at, but don’t trust that it accurately represents it. Try to determine the value of the property by looking at other properties in the area and inspecting the one you’re interested in.

It is of vital importance to do research before you even consider purchasing a house or an apartment. This is especially important for apartments where you should find out if there is a special levy in place or if the sinking fund is looking healthy.

Pre-approval for your home loan is vital knowing exactly how much you can borrow when you finally decide to purchase a house. If you purchase a property without pre-approval, there’s a possibility that the bank will not lend you the amount you need which could put you in a lot of trouble.

Finally, it is important to not underestimate the other costs involved with. After purchasing the property, you may end up having to pay for much more such as inspections, stamp duty and moving costs.

In a Nutshell:

  • Keep emotions out of your decision to buy property.
  • Don't assume that the property is worth the listing price.
  • Do your research before you even consider purchasing a house or an apartment.
  • Make sure you have pre-approval so that you know how much you're willing to spend.
  • Keep in mind that there are many other costs that come with purchasing a house or an apartment.

Read On: The Five Biggest Property Buying Fails and How to Avoid Them, by Julia Corderoy:

BUYING your forever home is one of life’s most exciting and emotional milestones. But it is also going to be your biggest commitment.

And in a competitive property market, the emotions of home buying can be amplified, making it even easier for first home hopefuls to make mistakes that could cost thousands.

These are the five most common buying fails property punters make, according Darren Piper, director of Universal Buyers Agents, and how to avoid them.

FALLING IN LOVE

Getting too emotionally invested in a home when house hunting is the biggest price driver, according to Mr Piper.

Once a buyer starts making decisions with their hearts instead of their heads, that’s when they overlook important issues, cloud their judgment, and ultimately end up paying too much for a property. In fact, real estate agents will be looking out for emotion they can play off.

“Certain comments you make when you are in the property make the price go north, so to speak,” Mr Piper, who was a real estate agent before becoming a buyers agent, told news.com.au.

“I’ve seen time and time again owner occupiers — it doesn’t happen so much with investors — walk into a property and start planning where furniture goes. It is certain comments like that where the agent will be rubbing their hands together.”

To avoid letting your emotions lead to an inflated price, Mr Piper said buyers have got to take a step back put on their best “poker face”.

“You really have got to have your poker face on and hold your emotions back. When you are a selling agent and you have a buyer coming through making comments like that, that shows a certain level of commitment and agents love that. It means the person is falling in love with the property and emotion is the biggest price driver,” he said.

Controlling your emotions becomes even more important if the buyer has missed out on a few properties previously or if the property is marketed as “by negotiation” with no price.

TRUSTING THE LISTING PRICE

A listing price shouldn’t be blindly regarded as a definitive or accurate price guide, according to Mr Piper, because a listing price is influenced by the seller.

House hunters need to be discerning, sceptical and inquisitive or they risk paying more than the property is worth.

“Buyers have this mindset that the selling agent is there to help them. But this really couldn’t be further from the truth,” Mr Piper told news.com.au.

“At the end of the day, the selling agent is paid by the seller to get the highest price. They are not there to make sure that the buyer buys it under market value.”

This is why Mr Piper said buyers should take the listing price with a grain of salt and do their own homework.

“A property could be listed at $750,000 and you see buyers go in and think if they could get it at $710,000 they have got a good deal. But in actual fact, if you do your homework and look at comparable sales in the area, the home might only be worth $670,000.

“Buyers are guided by the list price but I say to every client I deal with to forget the list price. It is really about where [the property] sits in the market.”

NOT DOING ENOUGH RESEARCH

Your real estate research shouldn’t stop at looking at comparable sales in the area, though. To ensure there are no surprises when you move in, you need to do a whole lot more research than you may think.

“It varies slightly from if you are buying a house or a unit. If you are buying a house, you need to check if there are any easements on the block, such as powerlines or underwater sewerage, which means you can’t dig on the land if you want to develop or renovate.

“Are there any development applications nearby? Especially in the inner city market, you hear horror stories of people who have bought property but haven’t looked if there are any development applications nearby and three months later the house next door has been knocked down and there are units going up.”

When it comes to apartments, Mr Piper said it’s important to go beyond looking at the cost of the quarterly body corporate payments.

“Is there a special levy in place? How healthy is the sinking fund? You hear stories where people buy an apartment in the complex and the sinking fund might have next to nothing in it. If there isn’t enough money in the sinking fund and there needs to be work done, they will have to put a special levy in place so your quarterly payments could increase from $1000 a quarter to $3000 a quarter.

“A lot of people just don’t go that step further and it can cause some severe heartaches in the long term.”

NOT GETTING A PRE-APPROVAL

Getting your finances in order before the property hunt makes the process a whole lot easier. This means going to your bank or mortgage broker and getting a pre-approval for your home loan. A pre-approval is where your loan limit is approved for a certain time, usually around three to six months.

Providing your circumstances don’t change, a pre-approval will allow a buyer to know exactly how much they can afford to pay for a property and gives them the freedom to make an offer on knowing their finance is already organised.

“I would strongly advise the client has a pre-approval in place. There is nothing worse than someone buying a property and having a 14-day finance clause in it but then the bank comes back and says they won’t lend you that much.

“It is important to know what capacity you’ve got right from the start so you’re not only wasting your time but everyone else’s as well.”

UNDERESTIMATING OTHER COSTS

There are so many more costs involved in purchasing a property than just the property itself — and they can add up to thousands of dollars extra.

Before even purchasing a property, buyers need to account for building inspections and reports, strata reports, pest inspections and council inspections.

And after purchasing a home, there are insurance costs, moving costs, stamp duty, council rates and transfer fees.

“People are aware there are other costs but often they don’t understand how much the costs are,” Mr Piper told news.com.au.

“Especially with first home buyers because they haven’t been through the process before.”

Credits:

Julia Corderoy

Real-estate Journalist at News

www.news.com.au

Are You Paying For Useless Insurance Through Your Super? Posted on:

Summary:

A large number of casual workers in Australia are unknowingly paying for insurance through their super. While this might seem like a good idea to some people, there is virtually no hope for casual workers making a successful claim. This is because when it comes to insurance, casual workers are treated very differently in comparison to permanent workers. In many cases, Australians are denied their claim simply because they are a casual worker.

This means that, since a lot of casual workers are earning enough per week to be in a superannuation fund, many are paying for insurance that is nearly impossible to claim. It is becoming increasingly clear that corporate interest drives the actions of banks, many of which own super funds as well.

In a Nutshell:

  • Many casual workers within Australia are paying for life insurance through their super on an 'opt-out' basis.
  • Casual workers are treated differently in comparison to permanent workers when it comes to insurance and many casual workers will have a claim denied simply because of this.
  • It is clear that big banks, many of which own super funds, are forgetting about their clients' interests and focusing on corporate interests.

Read On: Casual workers paying for 'junk' superannuation life insurance they don't know they have, Andrew Robertson:

There is a great insurance rip-off in Australians' superannuation funds that most people do not even know is happening, and it discriminates against casual workers.

Around a quarter of the Australian workforce is casual, and 40 per cent of those casuals are under the age of 25. Most casual workers are found in reasonably low-skilled occupations.

According to research by Federal Parliament, 41 per cent of casual workers are either labourers or sales people. Only 13 per cent are employed as managers and professionals.

All casuals earning more than $450 a week from a single employer are in a superannuation fund.

Most are in default "MySuper" funds, which offer life insurance on an 'opt out' basis.

Many would not even realise they have insurance, which they are paying for out of their super fund, and those who do would probably think they are protected if they have an accident at work.

They could be very wrong if the people the ABC has been speaking to are any guide.

Banks profit from blanket denial of casuals' claims

Little more than a week after the bosses of the big banks told a parliamentary inquiry they were cleaning up their act, there is more evidence of ordinary Australians being ripped off in the name of higher profits.

The superannuation industry, of which the banks are a major part, is generating billions of dollars from disability insurance on which casual workers have virtually no hope of making a successful claim.

Sydney based Eva Thorley is an example.

"I worked from 7am till 3:30 in the afternoon, overtime was included if there was any. You know I worked for this company for like seven years. As a casual but working permanent hours," explained Ms Thorley.

She worked full-time as a furniture removalist until a 60-kilogram safe fell on her foot.

Ms Thorley suffered a severe injury and when she tried to claim on her total and permanent disability insurance policy with CommInsure, it was denied because she was employed as a casual.

CommInsure scandal: Who's who?

Meet some of the key players involved in the scandal engulfing one of Australia's biggest life insurers, CommInsure.

"I can't help that I was casual. The company. That was their policy. They didn't want permanent staff. They only wanted casuals," she said.

Meanwhile, family circumstances forced Launceston truck driver Darren Woodward to switch from permanent to casual employment.

On his first day as a casual, doing the same job with the same company the following week, he fell off a truck and will never work again.

His total and permanent disability claim was also denied, by MLC.

"I thought it was a bit of a joke actually," recalled Mr Woodward.

"I thought someone was taking the mickey out of me. Because when you're insured I thought you were insured."

The cases of Darren Woodward and Eva Thorley are far from unique according to solicitor Carl Mickels from Firths Lawyers in Sydney.

He said it is discrimination against people employed as casuals who pay the same premiums and have the same risks as permanent staff.

"I find it appalling that this could occur when the person hasn't changed his occupational status. All they've done is change their hours from full-time to casual," he said in reference to Darren Woodward's case.

'Junk insurance' for casuals

What it means is you can have two people sitting side by side, doing the same job and working the same hours.

They both slip on the same banana skin and suffer the same career ending injuries.

But because one person is permanent and the other is casual, they are treated very differently by their insurer.

"There's no rhyme or reason why you would treat casuals differently from permanents," said Mr Mickels.

The way insurance companies discriminate against casuals is to apply a much tougher claims threshold.

Life insurance eroding super

Many Australians are paying unnecessary fees for duplicate life insurance policies across several super funds, the industry warns.

Permanent employees get measured against their ability to perform either their own occupation, or any other job they may be qualified for.

Casuals are measured against what is known as the "activities of daily living test".

Unless casuals need help doing the most basics of life - things such as going to the toilet, washing, or getting out of bed - the claim is denied.

A worker has to be virtually a quadriplegic to pass.

"In my experience, I can't recall ever satisfying them over probably 10,000 clients I have dealt with," explained Mr Mickels, who has been working in this area for nearly two decades.

"It's an impossibly high bar. It essentially makes the insurance junk insurance. Nobody can collect it."

But the insurers are collecting, about $6 billion a year from policies offered automatically with superannuation funds.

"It's totally unethical and it denies any duty of care on the part of the insurance company to provide a person with the insurance that the person they're providing the insurance to thinks they have," said Professor Thomas Clarke, who is the head of the Centre for Corporate Governance at the University of Technology in Sydney.

Life insurance dangers

The danger in relying on super-based life insurance is that it may not cover everything you think it does, warns Andrew Robertson.

There are 28 million superannuation accounts in Australia.

Around 15 million, or 53 per cent, are default funds, known as MySuper, which are chosen for workers by their employers.

My Super funds offer life insurance on an 'opt out' basis - and the vast majority of people do not opt out.

"It was done through the company I was working for. They organised it all. Me and the other workers that I worked with had nothing to do with it," said Ava Thorley about her situation.

According to the corporate regulator, ASIC, 16 per cent of total and permanent disability insurance claims are knocked back - the highest rejection rate of any form of life insurance.

One company, which ASIC will not name, rejected 37 per cent of claims - or more than one-in-three.

Danger for growing casual workforce

The legislation covering insurance in super says trustees of super funds must act in the "best interests" of the beneficiaries of that insurance.

But a 2014 letter from Queensland based LGIA Super, defending a claim from a casual worker it rejected, seems to sum up the industry's attitude.

It said, "the trustees are not obligated to provide insured benefits to all members on the same basis".

"The legislation specifically allows offering insured benefits of different kinds and levels," warned Mr Mickels.

"You need to be aware that you cannot trust your financial livelihood through your super if the trustees don't try to do the right thing by you."

That raises the issue of the genuine independence of some super fund trustees.

Eva Thorley's insurance was with CommInsure. Her super was with Colonial First State. Both are owned by Commonwealth Bank.

Darren Woodward's insurance was with the National Australia Bank-owned MLC and his super is an MLC fund.

"These conglomerate structures with separate divisions tend to pursue a corporate interest ultimately as their ultimate logic and the clients' interests are forgotten," said Professor Clarke.

Which, for Professor Clarke, is another danger signal for millions of people in a workforce which is now nearly 25 per cent casual.

"Here we have two individuals who have not had their insurance paid out for what are very unethical reasons," he said.

"But the worry would be that as casualization continues and expands to a larger and larger section of the population, not only are they losing their employment rights, they'll be losing their insurance status too."

It is cold comfort for the many casuals at the younger and most vulnerable end of the workforce and for older people too, including truck driver, Darren Woodward, who has learned the hard way that his total and permanent disability insurance was useless.

"You think you have every base covered in case the worst happens, but when it does happen you find out that the people you put your future in - all they want to do is knife you in the back and pull the rug out from underneath you."

Credits:

Andrew Robertson

Business Reporter at ABC

www.abc.net.au

Six Reasons to Get a Hobby Posted on: March 24, 2017

Summary:

With technology becoming such an integral part of our lives, we have made it a habit of telling others that we are 'too busy’. In reality, most of us spend a lot of time on our phones or computers being unproductive, under the illusion that we are hard at work. Saying that you don’t have time for a hobby probably isn’t true.

Having a hobby is incredibly important for having a rewarding and happy life. Hobbies help you to structure your time, they promote flow and give you an active lifestyle, they can help with forming new social connections, they give you purpose, and they can help you cope with stress. The benefits of having a hobby tend to spill over into other aspects of your life, so next time you make the excuse of ‘being too busy’ or ‘not having enough time’, take another look at yourself and decide if you are as busy as you say.

In a Nutshell:

  • Many people are under the illusion that they are busy when in reality a lot of our time is spent wasting time.
  • Hobbies are vital for having a fulfilling and active life, and everyone should consider spending time participating in a hobby.
  • There are a variety of different benefits which come with having a hobby.

Read On: Six Reasons to Get a Hobby, by Jamie L. Kurtz:

As a get-to-know-you exercise, I recently asked a new crop of college students what their hobbies were. Some were taken aback. Hobbies?! What a frivolous thing! Who has the time?

They’re not alone. Nowadays, we are just unbearably, painfully, overwhelmingly busy! Between running the kids from piano to soccer to math tutoring, keeping a tidy house, and staying on top of a constant influx of emails, how can there be time for anything fun?

It wasn’t always like this. In his influential book Bowling Alone, Robert Putnam documents a sweeping decline in civic engagement, from PTA memberships to neighborhood potlucks to, yes, bowling leagues. Over a couple of generations, Americans have somehow misplaced their free time.

Various things contribute to this, but for many of us, being legitimately busy simply isn't one of them. Instead, we habitually waste time, creating the illusion of busyness. Facebook, email, Netflix – pick your poison. If you’re like me, you don’t wake up in the morning with the goal of squandering so many precious moments on social media, but it often happens, and this is unaccounted for time that can be better spent elsewhere.

Consider the possibility that you’re not as busy as you think. In her recent book Overwhelmed: Work, Love, and Play When No One Has the Time, Brigid Schulte argues that “I’m too busy” has become a badge of honor, a sign of virtue and importance. We have done a bang-up job of convincing ourselves that we’re super-busy. Don’t buy into it. You have time for a hobby…or two!

Why you need hobbies:

Hobbies help you structure your time. According to Parkinson’s law, "work expands so as to fill the time available for its completion." More simply, things take as much time as you have. So, when the evening stretches out before you, unscheduled, you might find yourself laboring over that work project or answering emails into the wee hours. Chances are, if you had choir practice or a book club meeting that night, you would get those tasks done much more quickly. So, hobbies can seem to create more time by encouraging efficiency.

Hobbies promote flow. Left to our own devices, we often opt for passive leisure—TV and web surfing are at the top of most people’s lists. And, sure, we all need to veg out from time to time. But we are so much more invigorated by active leisure, the sort of thing psychologist Mihaly Csikszentmihalyi calls flow activities. If you’ve ever lost yourself in a sport, art project, or other challenging, absorbing activity, you’ve experienced flow. Time flies, self-consciousness disappears, and you are fully immersed in the activity at hand. Hobbies, especially those that stretch our skills, foster this desirable and increasingly elusive state.

Hobbies can foster new social connections. While some hobbies are solitary endeavors, many get us out in our communities, meeting people we otherwise wouldn’t, sharing our passions, and forming new bonds. Countless studies have found that social connection is a key component of happiness and a meaningful life, and hobbies have the potential to create precious new ties.

Hobbies make you interesting. Hobbies give you something to talk about at parties and around the water cooler. They add layers to your identity, richness to your self-concept. People want to be around those with passions, with a sense of curiosity, with stories to tell. You not only feel more inspired when you have a rich and active life, but you will inspire others as well.

Hobbies help you cope with stress. Imagine a rough day at the office, where you were harshly criticized by your boss. Coming home and turning on the TV may provide a brief distraction, but it doesn’t address your damaged ego head-on. Now imagine that after work you head out to your soccer league or pottery class. These activities are more than merely distracting. They remind you that that are many facets to your self-concept. Employee, yes, but also athlete or artist. As such, a blow to one aspect of your identity is less damaging. Simply put, your eggs aren't all in one basket.

And the benefits can spill over into other aspects of your life. If you can designate an hour a day or even a few hours a week for something you feel truly inspired and enlivened by, don’t be surprised if some of that newfound zest carries over into your work and family life!

So, what should you choose as your new hobby? Maybe there’s something you’ve always wanted to do, like learning to knit, garden or play the piano. Maybe there’s something you used to love that you’ve stopped doing. Perhaps you could reach out to a new organization: a community choir, softball team, or book club. If you’re feeling really open-minded, you could browse the local newspaper and pick something on a whim: “Beekeeping! Now THAT sounds interesting.” Just don’t follow that phrase with, “Ah well. Maybe someday, when the kids leave the house or when I retire.” Carve out the time and find a hobby now! You have more time than you think you do.

Credits:

Jaime L. Kurtz

Professor at James Madison University

www.psychologytoday.com

Listen to ‘Tech Support’ Scam Calls that Bilk Victims Out of Millions Posted on: March 20, 2017

Summary:

A new type of internet scam has risen over the past couple of years, and research shows that it could be doing a lot more damage than we think. The scam involves a pop-up indicating that your computer is filled with problems and that you should call the number listed as soon as possible. Though most people will see through this and close the pop-up, a small group of security researchers from the State University of New York decided to play along and call the listed number.
After calling the supposed ‘tech support’ crew behind the pop-up, the scammer would access their computer and pretend to analyse it and give the bad news. They would then offer a cleanup for around $300. The researchers found that these ‘tech support’ scams were much bigger than originally thought, with many taking in about $2000 from a single website from victims.
Through their research, they also found that there are some ways authorities can prevent these scams from happening in the first place. They found that the 22,000 pages which contained these scams used around 1,600 numbers from a variety of VoIP services. Encouraging these services to ban fraudulent numbers would end up making the scam more expensive and less likely to be successful. Their research also shows that a brute force attack could be a possible solution to dealing with these ‘tech support’ call centres. By sending hundreds of calls to one of the scam numbers, authorities could potentially overload the systems behind the scan and create a major inconvenience for them.

Regarding what you can do to avoid these scams, Nikiforakis states that you should not ‘trust what your browser tells you about the safety and security of your computer’. Remember that there are good, free anti-virus programs available to you.

In a Nutshell:

  • A new type of internet scam has emerged and could end up costing the victim $300.
  • Researchers purposely called the fake 'tech support' team behind the scam to understand the scale of the operation.
  • Through their research, they found that significant scamming operations like these could be taking in more than $2000 per day per website.
  • There are a variety of different ways authorities can make it harder for scammers to succeed.
  • If you want to avoid becoming a victim of an internet scam, simply remember that you should not 'trust what your browser tells you about the safety and security of your computer'.

Read On: Listen to 'Tech Support' Scam Calls that Bilk Victims Out of Millions, by Andy Greenberg:

THE SCAM STARTS with a warning on your computer—a shamelessly fake one, often imitating a blue screen of death or a blinking malware alert. It informs you that your PC suffers from a smorgasboard of security problems, ranging from stolen credit cards to breached family photos to stalkers watching you through your webcam. And it offers a toll-free number for a “Microsoft” support line.

You probably (hopefully) know better than to dial that number. But three security researchers from the State University of New York at Stony Brook did it anyway. Again and again, for hours on end, they played out the full racket, calling actual human tech-support scammers who patiently, fraudulently “analyzed” their computers’ security via a remote connection. Each time, they found it supposedly infected with viruses and spyware, and offered a cleanup for a fee—on average around $300.

What they found, after all those calls? The disturbing scale of those so-called “tech support” scams. And, the team hopes, some clues about how to prevent more vulnerable marks from getting bilked by the call centers that carry them out.

1-800-SCAMMERS

At the Network and Distributed Systems Security Symposium two weeks ago, the Stony Brook team showed how they mapped out those fraudulent tech support call schemes more thoroughly than ever before. Using an automatic web-crawling tool, they visited tens of thousands of the web pages that ensnare victims in the scam. And then they went further, actually dialing 60 of those numbers, and spending a total of more than 22 hours on the phone with the scammers, pretending to be victims to hear the fake IT help desks’ entire scripts.

Their research offers new measurements of the scope of those scams, which count revenue in the tens of millions of dollars. It provides methods for identifying the largest scam call centers. And it hints that the best way to attack the problem may be preventing scammers from generating new phone lines.

“We wanted to know how big this scam was, how do scammers reach people, and when they get them on the phone, how do they convince them” to spend hundreds of dollars on fake malware fixes, says Nick Nikiforakis, the Stony Brook computer science professor who led the team’s research. “This was a way to find tech support scams automatically at scale and to understand their anatomy.”

As part of that analysis, the three researchers each called 20 of the scam lines and recorded the results. Three example recordings are embedded below, as is the full paper, which includes in its appendix two of the call transcripts.

Bad Support

The team found that the scammers followed a very predictable series of steps: First, they said they needed to learn more about the malware that had supposedly triggered the browser alert. They then asked the victim to visit a website, download a remote administration tool, and give the scammer access so that they could run “tests” on the machine. (To avoid giving themselves away to the scammers who connected to their PCs, the researchers invited them to connect to fake virtual machines they’d pre-populated with enough software to look realistic.)

“It was very stressful. You’re interacting with a person you’re lying to for 20 minutes, and you know they’re lying to you, too,” says Nikiforakis. “They were scamming us, and we were scamming them in the name of science.”

Once connected, the scammers would click around the would-be victim’s computer and ask about recent usage, implying that whatever the caller had done had led to the machine’s corruption. They’d praise the computer’s underlying hardware, to give the victim a sense that cleaning up its infections would be worth the money. Then they’d point to entirely normal but obscure features of the operating system—listing Windows’ “stopped” services, Netstat scans, Event Viewer, and so on—as evidence of malware or hacker intrusions. Finally, they’d tell the victims about pricing plans for cleanup services, which averaged $291.

The researchers also traced the IP addresses of the remote administration tools the scammers used, which provided an educated guess at where they were based: 85 percent were in India, a logical location given its relatively low wages and English-speaking population. Another 10 percent were in the United States, and the remaining five percent were in Costa Rica.

Those calls, and the pricing data they generated, were only one component of the study. To find as many of the scam sites as possible, the researchers built a software tool they called “ROBOVIC” (or “robotic victim”) to automatically visit millions of websites in search of tech-support scam pages. They targeted their crawler in particular at misspellings of popular websites—knowing that scammers often create “typosquatting” pages that impersonate legitimate sites—and certain URL shorteners that show spammy ads to visitors.

Out of five million pages it visited, ROBOVIC discovered about 22,000 tech support scam pages hosted at roughly 8,700 domains. By a stroke of luck, they found that an Apache module in 142 of those pages exposed traffic-counting code, allowing the researchers to estimate how many visitors those pages received. Since prior research on fake antivirus scams indicate about two percent of people fall for similar traps, the team estimated that the domains each took in about $2,000 a day.

By periodically visiting the scam sites, they also learned how long those pages stayed online before disappearing—likely as domain-hosting companies discovered the fraud and removed them. About 70 percent survived for between one and three days, though about 7 percent lasted well over a month. Based on all of that data taken together, the researchers roughly estimated that the scam domains they discovered made about $75 million a year. But given that they’ve likely found only a fraction of the scam sites and didn’t track the total number of campaigns creating them, they don’t claim to have an estimate for the entire tech-support scam industry.

Getting Ahead of It

The researchers’ work provided a few ideas about how authorities can prevent tech support scams, or at least render them less profitable. They found that that the 22,000 pages used just over 1,600 phone numbers among them, mostly sourced from VoIP services like Twilio, WilTel, RingRevenue, and Bandwidth. Encouraging those services to ban known fraud numbers could offer a pressure point. “If you blacklist numbers, you can make the scam more expensive,” Nikiforakis says.

They also suggest two methods for estimating the effectiveness of various call-center operations, to better prioritize law enforcement’s response. Gathering data about the number and length of calls to a certain call center should sniff out the most lucrative schemes, the researchers argue. To that end, they conducted second experiment in which 20 volunteers dialed into a call center simultaneously. The Stony Brook team then counted how many were put on hold, to estimate the operation’s overall capacity.

All of those tactics are more than theoretical. Nikiforakis presented the Stony Brook study at the Federal Trade Commission last year, and the FTC is actively taking on the scammers. The commission sued one Florida call center, extracting a $10 million ruling in December. “Before you can stop these scams, you have to really understand how they work,” says Lorrie Cranor, who was resident technologist at the FTC at the time of Nikiforakis’ visit. “This research really maps that out nicely.”

Beyond law enforcement raids and phone number blacklists, Nikiforakis says that education could solve the tech support scam most effectively of all. Victims need to learn to spot online virus infection warnings as fraud, long before they start a 20-minute phone call with a fake help-desk grifter.

“Don’t trust what your browser tells you about the safety and security of your system,” says Nikiforakis. “People need to understand there’s no legitimate scenario where your computer will start beeping and ask you to call a toll-free number.”

Credits:

Andy Greenberg

Senior Writer at Wired

www.wired.com

Shareholders Set to Receive More Than $22 Billion in Dividends Posted on: March 17, 2017

Summary:

Shareholders will be paid more than $22 Billion in dividends from March to July due to strong profit growth in the season. Mining companies will focus on returns to capital shareholders while industrials will concentrate more on investment. No doubt, shareholders will reap some of the rewards for this positive season.

Australian companies are in good shape and the Australian share market is paying more than acceptable dividends. These high dividends are difficult to find in other share markets around the world and will no doubt support spending in the economy.

There are some concerns regarding reinvestment, however, as most ASX-listed companies are paying out dividends rather than reinvesting them.

Investment beyond the mining sector is still lacking, though with the economic outlook becoming more certain the focus should soon shift towards investment as opposed to paying out dividends.

In a Nutshell:

  • ​Shareholders will be paid more than $22 Billion from March to July due to strong profit growth in the season.
  • The Australian share market is in good shape and is paying higher dividends than other share markets around the globe.
  • Some concerns have been raised about reinvestment since many listed companies are simply paying out dividends.

Read On: Shareholders set to receive more than $22b in dividends, Lucia Stein:

Shareholders are poised to be paid more than $22 billion in dividends from March to July after a bumper corporate profit season, according to CommSec research.

The figure is up from dividend payouts during the same time last year, which CommSec said totalled about $19 billion.

The chief economist and head of investment strategy at AMP Capital, Shane Oliver, said the strong profit growth is going to result in "strong dividend growth".

"For mining companies, the focus is going to be on dividends [after strong investment during the mining boom], returns to capital shareholders where they can," he said.

"For industrials, I kind of think over the next 12-18 months you will see a bit more focus on investment."

CommSec's chief economist Craig James agrees that shareholders will reap some of the rewards from a positive corporate reporting season.

"The bottom line is that Australian companies are in good shape - they're reporting profits and determining they want to reward shareholders," Mr James said.

According to Shane Oliver, decent dividends will support consumer spending.

"A portion of the dividend payment no doubt will be saved, some of the money will no doubt be invested in the share market, but a significant proportion of it will be spent," he said.

"I think there is no doubt that dividend income is something that Australians have become increasingly reliant on.

"The Australian share market is one share market that pays pretty good dividends, at the moment the dividend yield on shares is about 4.5 per cent and, including the franking credit, its pushing up to 6 per cent.

"There's very few share markets around the world that pay such high dividends and there's no doubt that does support spending in the economy, particularly in an environment where bank deposit rates are so low ... around 2.5 per cent depending on the deal you've got."

Mr James, however, has raised concerns that dividends are being paid out instead of money being reinvested into business operations.

He said 88 per cent of ASX-listed companies have opted for paying a dividend, rather than using the money to reinvest.

"I think there is still concern about embracing growth in the current environment," Mr James explained.

"I suppose we get back to the GFC [global financial crisis] and, when you look at consumers and businesses around the globe, there is still a reluctance to embrace operations of putting money back into business, trying to grow your business."

However, Mr Oliver contends that the outlook for the next year is much more optimistic for businesses.

"Investment outside the mining sector in Australia has been lacking but, as the economic outlook becomes a bit more certain, a bit more secure we should start to see a bit more of the focus shifting towards investment as opposed to paying out dividends.

"[But] I don't think companies are going to cut their dividends though, it might just be the case that they will start to slow down the growth rate of dividends compared to the growth rate of profits."

Credits:

Lucia Stein

Digital Producer at ABC News

www.abc.net.au

RBA Board Meeting Decision March Posted on:

Summary:

While conditions in the global economy are continuing to improve, with consumer confidence up, there remain uncertainties which present risks to our economy. As such, the RBA have decided that leaving interest rates unchanged at 1.5% will help Australia to sustain growth and achieve inflation rate targets.

In a Nutshell:

  • Philip Lowe, Governor of the RBA, has on three occasions outlined why he does not believe reducing interest rates further will help the Australian economy meaning that unchanged rates are not particularly surprising, and we should not expect movement for a couple of months.​
  • China is the leading cause for uncertainty in the RBA's opinion and in particular the fact that most of their growth is a result of high spending on national infrastructure and the lending associated with this.
  • The good news for Australia is that on the whole, the global economy appears to be improving. Inflation rates have moved higher in most countries, bond yields have risen, interest rates are expected to increase in the US, and financial markets have been functioning effectively. In the opinion of the RBA, maintaining low-interest rates will support this.
  • Given the decision to remain the same, retail interest rates remain at all-time lows, making it a great time to review your current mortgage and to consider cost-effective ways to reduce your principal before interest rates rise.

Read On: Statement by Philip Lowe, Governor: Monetary Policy Decision:

At its meeting today, the Board decided to leave the cash rate unchanged at 1.50 per cent.

Conditions in the global economy have continued to improve over recent months. Business and consumer confidence have both picked up. Above-trend growth is expected in a number of advanced economies, although uncertainties remain. In China, growth is being supported by higher spending on infrastructure and property construction. This composition of growth and the rapid increase in borrowing mean that the medium-term risks to Chinese growth remain. The improvement in the global economy has contributed to higher commodity prices, which are providing a significant boost to Australia's national income.

Headline inflation rates have moved higher in most countries, partly reflecting the higher commodity prices. Long-term bond yields are higher than last year, although in a historical context they remain low. Interest rates are expected to increase further in the United States and there is no longer an expectation of additional monetary easing in other major economies. Financial markets have been functioning effectively and stock markets have mostly risen.

The Australian economy is continuing its transition following the end of the mining investment boom, expanding by around 2½ per cent in 2016. Exports have risen strongly and non-mining business investment has risen over the past year. Most measures of business and consumer confidence are at, or above, average. Consumption growth was stronger towards the end of the year, although growth in household income remains low.

The outlook continues to be supported by the low level of interest rates. Financial institutions remain in a good position to lend. The depreciation of the exchange rate since 2013 has also assisted the economy in its transition following the mining investment boom. An appreciating exchange rate would complicate this adjustment.

Labour market indicators continue to be mixed and there is considerable variation in employment outcomes across the country. The unemployment rate has been steady at around 5¾ per cent over the past year, with employment growth concentrated in part-time jobs. The forward-looking indicators point to continued expansion in employment over the period ahead.

Inflation remains quite low. With growth in labour costs remaining subdued, underlying inflation is likely to stay low for some time. Headline inflation is expected to pick up over the course of 2017 to be above 2 per cent, with the rise in underlying inflation expected to be a bit more gradual.

Conditions in the housing market vary considerably around the country. In some markets, conditions are strong and prices are rising briskly. In other markets, prices are declining. In the eastern capital cities, a considerable additional supply of apartments is scheduled to come on stream over the next couple of years. Growth in rents is the slowest for two decades. Borrowing for housing by investors has picked up over recent months. Supervisory measures have contributed to some strengthening of lending standards.

Taking account of the available information the Board judged that holding the stance of policy unchanged at this meeting would be consistent with sustainable growth in the economy and achieving the inflation target over time.

Credits:

Philip Lowe

Governor of the RBA

www.rba.gov.au

Women’s Money Challenges Posted on: March 10, 2017

Summary:

We live in a world today where equal opportunity for everyone has never been so accessible. That being said, we still haven’t achieved true equality, and many find themselves in worse positions than others due to factors they couldn’t control.
Women today still face many challenges, especially when it comes to managing their finances. The average day for a working woman can be very stressful, and many women are in a balancing act in an attempt to provide for their family. Sometimes prioritising care over their families can result in a much lower superannuation balance for retired women in comparison to retired men. This can make it tough to live after retirement, especially for women since they have higher life expectancy.

It is important to consider the small changes you can make as a woman to have a big difference on your financial future. Understanding your super, making plans for the long term and building savings to help with life’s ups and downs and have a very positive effect on your financial future.

In a Nutshell:

  • The daily working life of an average woman can be very stressful, especially since many women are also caring for and supporting their family members.
  • One average, women end up with a much lower superannuation balance in comparison to men, often due to the prioritisation of family.
  • There are many small changes a woman can make to ensure they have a strong financial future.

Read On: Women's Money Challenges, Money Smart:

Credits:

Money Smart

Australian Securities & Investments Commission ​

www.moneysmart.gov.au​

11 Things You Can Do To Manage Uncertainty & Market Fluctuations Posted on: March 3, 2017

1. Plan Ahead

Stock markets in the developed world have delivered the best returns over the long-term (some 4% per annum over bank deposit returns), but if you are going to benefit from those superior returns, then you had better have an investment plan that can handle the volatility. This means planning for volatility at the outset

Having an investment plan that caters to your needs is important. Everyone has their priorities regarding financial matters, and you should create a solid plan that meets your specific needs. You need to create short and long term goals, which you can focus on in times of volatility. Having a plan is the first and most important step to achieving anything, and to stay in the market even in times of uncertainty, you need to prepare yourself for it and create strategies on how to deal with it.

Seasoned investors understand that having a financial plan, diversified investments and being able to stay focused on the long-term goals will dramatically increase their chances of success. While we are not certain of the short-term direction of markets, we can have some confidence that well-diversified portfolio should give us an opportunity for gain while limiting exposure to losses.

2. Don't Try to Time the Market

Thinking that you will invest at the “right time” is the wrong approach. A market cannot be “timed” and deciding beforehand that you will wait until the conditions seem better for investment is a recipe for disaster.

Investors constantly hunger for that extra piece of information that will give them an edge over the market. But the truth is that it is often more discipline -- not more information -- that will help them succeed.

Unpredictability is the largest factor in a market, and staying invested while the market has taken a hit, instead of bailing out entirely, is a strong decision which would later turn fruitful when the rebound will provide you with the best of the market.

3. Don't Let Emotions Get in the Way

In a majority of the cases, market volatility is caused by short-term events, such as sudden changes in oil prices. If, in times like this, you make investment choices out of fear, then you will be unable to enjoy the long-term benefits of the market. It is, therefore, important not to let the fear of losing money blind you from looking ahead for profitable investments.

If you invest for long terms, without worrying about market fluctuations, there is a high chance that you will end up with a higher rate of return than you thought. This is because sometimes, the rebound market provides higher profits, so the investors who had not bailed out would profit from a high rate of return.

4. Schedule A Review With Your Adviser

  • Take a step back and ignore the noise (news sites, online spectators, the taxi driver and the guy at the water cooler) and speak with your licensed financial adviser.
  • Have a discussion with your adviser and see if its might be time to look for opportunities to re-balance. Often investors will have short, medium and long-term goals. Look at the timings of these and goals. For example, if you have some money invested for your daughter’s wedding (which is a short term goal) look at moving short term goals to cash if this is deemed appropriate.
  • Use the down market to look for opportunities such as improving your portfolios Dollar Cost Average (we discuss this a little more down the page).

5. Diversify Your Investments

In the investment business, it is important not to have all your eggs in a single basket. If you only invest in the shares of your company, then you lose the chance of gaining the benefits from other sources that would have been larger than the benefits you gain from only one company.

Also, by diversifying, you spread the risk. So, if the market is volatile in one sector that you have invested in, you can still gain from your investments in the other markets.

6. Understand Your Risk Tolerance

There are always risks when it comes to investment. With high return investments, the risk is high, and with the low return investments, the risk is low. Before investing, one should take care about the potential risks. In volatile markets, there is a greater chance that your risks in investment may end up with a huge loss of money for you, so it is important to keep a balance between all the potential risks and the rate of return that you might get.

​7. Be Comfortable With Your Investments

Before investing, you should do your research. Invest in markets that you feel compatible with—in which you would have a lower stress level than others. It is important that you are comfortable with the choice of your investments. Market volatility creates huge pressures on its own, and topping it with being uncomfortable about the investment will only make it worse, and end up making terrible investment decisions.

Re-evaluate your investment mix if it feels too stressful for you, and choose the one that feels just right.

8. Invest Regularly

The best way to make the best of the volatility in the market is to keep investing. This is because if you invest for a long period of time, the short-term fluctuations will have little or no impact on the state of your investments.

Investing in volatile markets does not take any secret ingredient; it only takes persistence and patience to follow the solid financial plan that you had made.

9. Stay Focused On Your Long-term Goals

By keeping your eye on the bigger picture, you will be able to tune out the random noise of the volatility of the market and stay focused on working towards your goal.

It is common that whenever a market takes a plunge, the media is filled with the news and it creates havoc for a lot of people. First-time investors, especially, take the news to heart and quickly proceed to bail out of their investments, disregarding their goal. This negativity bias will only create problems if you wish to stay in the investment market.

Overestimating the risk would lead you to losses in investment in the long run. By being focused on your long-term goal, you will be able to accept volatility as a factor that is inevitable in the investment market and will also keep your emotions in check, teaching you to be more confident in investing.

10. Convert Market Volatility Into an Investment Opportunity (Improve Your Dollar Cost Averaging)

It may seem heartbreaking to see the value of your investment taking a downfall, but you should remember that it can be a good thing for many investors. You have the chance of turning volatility into an investment opportunity by adding capital to your portfolio during times of pressure, which may mean you may be able to acquire that are likely undervalued due to downturn market pressures.

By following dollar cost averaging (DCA), you can protect yourself against market fluctuations and downside risk in the market. By buying a fixed dollar amount on a regular schedule, your focus is on accumulating assets on a regular basis.
By using DCA, you can then see market volatility as an opportunity - buying fewer shares when the market is high and more shares when the market is low. This way, you will be investing in a productive manner instead of trying to time the market.

The bottom line is that with dollar cost averaging, you can reduce market risk and build your investments over time, regardless of where the market is going.

11. Review Your Portfolio

Keep track of your money by analysing your account. Take a look at your contributions and which investments they have gone towards. Looking at your account, do you feel that your choices are correct? If not, it is time to re-invest.

In addition to this, as an investor, you should always take a good look at your contribution rate every time you get a boost in wages and adjust accordingly.

Final Thoughts

Volatility in a market is inevitable, and the quicker an investor takes to understand this fact, the easier it becomes for the investor to make better decisions in investment, and gain high returns.

The major mistake that many investors make is waiting to get back into the market. Unfortunately, waiting for a green signal to commence investments will leave them with missed opportunities that they could have gained by remaining invested in a volatile market.

Being spooked by the market volatility is no way to deal with it. All the methods that we have mentioned focus on how you can convert this time as an opportunity for yourself, and make smart investment decisions that will provide you with high return rates in the long term.

Employee Spotlight February Posted on: February 27, 2017

This month we caught up with a dedicated member of the Future Assist team, Gavin Liu, to ask a couple of questions about his work here. Gavin is a Senior Advisor who has been with us for four years. He has proven to be a valuable member of our team and one of our brightest advisers.

How did you come to Future Assist?

My background is a mix of progressive positions and responsibilities in a variety of areas and industries all with financial, advisory, and customer service components. With my Bachelor of Commerce from Griffith University, I’ve worked as a mortgage broker, accountant, and in real estate. My interest in financial planning developed slowly, and FA came across at the perfect time.

How do you describe the type of work you do?

I am constantly providing clients with advice focused on meeting their financial goals. I am always using problem-solving skills to evaluate strategies of various plans and finding ways to communicate results to clients in a way that is easy for them to understand.

What is your favourite part of the job?

Working with clients to develop a strategy for their financial future.  I really enjoy working with our clients, its the best part of my job.

What is the average day at Future Assist like for you?

My day usually consists of talking with different clients over the phone, holding meetings with clients and FA Panel members and ensuring the advice we deliver is tailored to clients’ needs.

If you could describe Future Assist in three words, what would they be?

Strong, positive change.

What keeps you motivated?

A couple of things. Firstly, I get to work with motivated clients and see them achieve their goals and secondly I get to work with a great group of people.  I have worked in 3 offices now and I am always surrounded by a lot of enthusiasm which makes my work very enjoyable.

What do you like to do outside of work?

Many things, Gym, hiking and basically anything that gets me outdoors and active.

Everything You Need to Know About the Penalty Rate Cuts Posted on: February 24, 2017

The Fair Work Australia Commission has handed down its decision that will affect employers, consumers and especially workers. They have decided to cut penalty rates for those who work weekends in hospitality and retail jobs. People working in these fields will be the hardest hit by the changes, and many of them rely on penalty rates due to already low wages. Many people agree that this is a ‘pay cut for the lowest paid individuals in the country’ and it is ‘not acceptable.’

Full-time and part-time hospitality workers will have Sunday rates down from 175% to 150%, while casual rates will stay at 175%. Full-time and part-time level one fast food workers will have rates reduced from 150% to 125%, while level two and three employees will stay at 150%. Full-time and part-time retail employees will have their rates reduced from 200% to 150% on Sundays, while casuals will have it reduced to 175%. Sunday rates for pharmacy workers will be reduced from 200% to 150% for full-time and part-time employees, while casuals will have rates reduced to 175%.

If you’re a consumer, you will most likely still have to deal with public holiday surcharges. John Hart raises the point that decreasing the penalty rates will not make it easier to meet the costs of staffing; thus public holiday surcharges will most likely remain.At the moment, it is still unclear when the changes will be implemented; however, it is evident that these changes will indeed affect everyone who has some interaction with these businesses.

In a Nutshell:

  • The Fair Work Australia Commission has decided to cut penalty rates for retail and hospitality workers.
  • All full-time and part-time employees will see Sunday penalty rate reductions, while casual workers will most likely see no or little change.'
  • The changes will not result in reduced public holiday surcharges; therefore the decision affects almost everyone.

Read On:What penalty rate cuts mean for you, by Liz Burke & Frank Chung:

Hospitality and retail workers are in mourning, small business owners are cheering, and a whole lot of us have been left pretty confused after the Fair Work Commission decided to slash Sunday penalty rates.

The FWC handed down its long-awaited decision today that will affect workers, employers, and consumers alike.

If you’re a double-time-loving waiter, a budget-conscious boss or the kind of person who enjoys going out for breakfast on the weekend every once in a while, you need to get across the changes.

WHAT’S ACTUALLY CHANGING?

In a number of industries, workers get paid extra on weekends and public holidays, but not everybody agrees they should.

Retail and business groups have been leading the case to reduce Sunday penalty rates from double time (200 per cent) to time-and-a-half (150 per cent), in line with Saturday penalty rates.

Across hospitality, fast-food, and retail, those rates have been slashed by varying degrees today.

There will also be varying changes to early and late night work loading for restaurant and fast food workers.

WILL IT AFFECT ME?

The workers who will be hardest hit are those in the retail, hospitality and fast food industries.

Aussie who rely on penalty rates generally earn a relatively low wage.

Australian Council of Trade Unions president Ged Kearney says the cuts are “not acceptable” and that the cuts would have dire consequences for almost 1 million Australian workers and for the economy.

She says the changes are “a pay cut for the lowest paid people in the country”.

The ACTU estimates the FWC decision will cost low-paid workers up to $6000 a year.

IF YOU WORK IN HOSPITALITY

Fulltime and part-time hospitality workers will have Sunday rates slashed from 175 per cent to 150 per cent.

Sunday rates for casuals will remain at 175 per cent.

If you’re on the national minimum wage, $17.70 per hour, an eight-hour Sunday shift would have earnt you about $248.

Under the changes, that drops to $212 — a difference of about $35 for the shift.

For someone earning, say, $30 per hour, the hourly rate would drop from $52.50 to $45. Instead of $420 for an eight-hour shift, they would now get $360.

On public holidays, rates have been cut for fulltime and part-time workers have also been cut from 250 per cent to 225 per cent. Casuals will remain at 250 per cent for public holidays.

IF YOU WORK IN FAST FOOD

Fulltime and part-time level one fast-food workers will have Sunday penalty rates reduced from 150 per cent to 125 per cent.

Level two and three employees will stay at 150 per cent.

IF YOU WORK IN RETAIL

Fulltime and part-time retail workers will have Sunday rates reduced from 200 per cent to 150 per cent, while casuals will be reduced from 200 per cent to 175 per cent.

As in hospitality, fulltime and part-time retail workers have been cut from 250 per cent to 225 per cent, but casuals will remain at 250 per cent.

IF YOU WORK IN PHARMACY

Sunday rates for pharmacy workers between 7am and 9pm will be reduced from 200 per cent to 150 per cent for fulltime and part-time workers.

Casuals will be reduced from 200 per cent to 175 per cent.

IF YOU’RE AN EMPLOYER

Employers in these industries are the ones who have been pushing for these cuts.

They say the penalty rates have hindered their business by making it too expensive to operate efficiently on the days that demand extra pay.

Businesses argue that, ultimately, this change means more jobs for Australians because they will be able to afford to give workers more shifts.

IF YOU’RE A CONSUMER

Could this be the end of public holiday surcharges? If restaurant and cafe workers are being paid less surely we shouldn’t have to charge more to cover their inflated wages on those days, right?

Wrong, according to Restaurant and Catering Australia chief executive officer John Hart.

Mr Hart says the restaurant industry is still waiting on a decision to change their award, and even if Sunday and public holiday rates were further lowered, they would still not meet the costs of staffing.

“To be honest, the rates going down won’t alleviate the need for a surcharge on public holidays,” he told news.com.au.

“At 225 per cent you’re still paying more than double time. As it stands at the moment, wages are nearly 50 per cent of turnover. Even with these changes you’re still in a place where there is an extraordinary amount of addition cost, which isn’t met by any sort of surcharge.”

WHY IS THIS HAPPENING NOW?

The reform was one of a number of workplace recommendations made by the Productivity Commission last year. The FWC had been considering bids from business and employer groups to lower Sunday rates since 2015.

A decision was expected at the end of last year but repeatedly delayed.

WHEN DO THE CHANGES KICK IN?

It not clear when the Sunday pay rate cuts take effect. However, we know that the changes to public holiday rates begin on July 1.

Early and late night work loadings in the restaurant and fast food awards will take effect in late March.

Credits:

Liz Burke & Frank Chung

Senior Reporter and Finance Reporter at news.com

www.news.com.au

Tasmanian Property Boom Fuels Budget Surpluses for Four Years Posted on: February 23, 2017

Summary:

The booming property market in Tasmania will assist in keeping the State Budget in surplus over the next four years. A $148 million increase in conveyance duty and land- tax revenue as well as an increased share of GST has led to this increase. It has come as a direct result of more property transactions and increased property values.

Hobart house prices outperformed every Australian capital city for the 3 month period with 5.8% growth.

Treasurer Peter Gutwin predicts that they will be able to afford to pay for essential services such as health, education and supporting their most vulnerable.

In a Nutshell:

  • Tasmania propery market increases will lead to surplus for next 4 years.
  • House prices in Hobart increased by 5.8% for 3 months up until January 31, the highest in capital cities in Australia.
  • Surplus will lead to spending in areas such as health, education and supporting their most vulnerable.

Read On: Tasmanian property boom fuels budget surpluses for four years, by David Beniuk:

Tasmania’s booming property market will help keep the State Budget in surplus for the next four years, according to new Treasury forecasts.

A $148 million increase in conveyance duty and land-tax revenue, as well as an increased share of GST, will be revealed when the Revised Estimates Report is released today.

“The increase in both conveyance duty and land tax are a direct result of more property transactions and increased property values, which is reflective of the stronger and more confident Tasmanian economy,” Treasurer Peter Gutwein said.

Hobart house prices outperformed every other Australian capital city in the three months to January 31, up 5.8 per cent.

Tasmania’s GST share will increase by $127 million over the next four years, the figures show.

Mr Gutwein said the increases, along with spending below revenue growth, would keep the Budget in the black.

“The Budget is now forecast to be in surplus for at least the next four years, meaning we can continue to afford to pay for essential services like health, education and supporting our most vulnerable,” he said.

This year’s surplus is forecast to be $47.7 million, down from the $77.3 million predicted in last year’s Budget.

A deficit was forecast for 2018-19 before a return to surplus a year later.

The report reveals a $29.5 million bill for last winter’s floods, the largest single spending measure since the Budget was handed down.

The budgetary position could yet be affected by GST fluctuations and Mr Gutwein warned these could be “highly volatile”.

“Spending discipline remains critical,” he said.

“As recent years have demonstrated, forecast GST increases can just as quickly disappear, so it’s essential that we plan carefully and don’t spend today money that may no longer exist tomorrow.”

Credits:

David Beniuk

Journalist at News Corp

www.themercury.com.au

How to Save Thousands of Dollars in 2017 the Easy Way Posted on: February 22, 2017

Summary:

Fine tuning your finances in 2017 without making overly drastic changes could end up saving you a substantial amount. The key to succeeding is taking action by sticking to a plan now rather than later.

Saving $1,000 a year can be as easy as preparing your lunch instead of going out twice a week and spending $10 per meal. Bring a sandwich, take last night’s leftovers or even making a salad could save you at least $10 per day.

Another common expense is transport. Are you driving to work? Maybe it’s time to consider a different means of transport as public transport is getting more and more affordable every year.

With a little planning, significant savings can be made by reassessing your grocery shopping habits. If you are attending your local store 2-3 times a week are you only buying what you need? Usually, the answer to this is no. Try doing one big shop a week, and the savings should start rolling through. Don’t forget to put all those savings into a savings account or speak to your Adviser about investing it.

You can save on a much larger scale, but this takes bigger changes in your financial situation and help from your Financial Adviser. One of the most important things to consider is your interest rates and how you are managing your debt repayments. Massive savings can be made by paying more than the minimum on your credit card or reducing your interest rate on your mortgage.

In a Nutshell:

  • Easy changes in 2017 to your financial situation and lifestyle can result in big savings.
  • Acting now can potentially save you $1000-$10,000.
  • Much larger savings can be made with bigger changes in your financial situation.

Read On: How to Save Thousands of Dollars in 2017 the Easy Way, by Sophie Elsworth:

JANUARY is the month many of us promise ourselves we will try to save more and spend less, but often, like many resolutions, the challenge proves too much.

But by taking some simple steps to fine tune your finances in 2017, there are ways you can save yourself $1000, $5000 or even $10,000 without making overly drastic changes to your lifestyle.

The key to success is taking immediate action to ensure you are setting yourself up for a financially flourishing 12 months.

HOW TO SAVE $1000

Kiss goodbye the luxury of buying your lunch every day, it’s time to go back to basics and pack your food before heading off to work.

Spending at least $10 a day on lunch twice a week amounts to $20 every week or just a touch over $1000 a year and financial comparison website Finder.com.au’s spokeswoman Bessie Hassan said with a bit of preparation this is easy to do.

“Bring last night’s dinner leftovers to work, make a sandwich or a salad and save at least $10 per day,’’ she said.

Another cost-saving measure for those living in metropolitan areas is to consider riding to work — this could result in significant transport costs, whether it be parking or catching public transport.

Paying $10 a day to park your car will amount to more than $1000 a year, without even considering the cost of fuel and wear and tear.

HOW TO SAVE $5000

Mother-of-two Melissa Rahne, 31, and her husband Joe have sat down and assessed their finances this year and said when it comes to grocery shopping, some extra planning will leave them $5000 better off this year.

“We are going to start saving money by doing one big grocery shop a week instead of going to the supermarket two or three times a week,’’ she said.

“This should save us about $100 a week as I usually go a few times a week and spend a lot more because you don’t just buy that one thing you need.”

Also simple savings can be made by setting aside the bonus amounts made from cutbacks, i.e. on grocery bills and automatically directing that money into a savings account — by stashing $100 a week away you will end up with about $5000 by the year’s end.

HOW TO SAVE $10,000

To make hefty savings of around $10,000 a year it might involve making several significant changes to your financial situation and Ms Hassan said for those with a home loan this is a great place to start.

She said that if you are paying the standard variable rate of 5.25 per cent with one of the big four banks, on a $300,000 mortgage over a 30-year term, you are paying $1667 per month in principal and interest charges.

But by searching for one of the lowest variable rates, you could slash your monthly repayments by $295 per month to $1372.

This would lead to huge savings of about $3540 annually.

Credit cards are also a money sucker so by paying more than the minimum amount you can save a small fortune.

The average card debt is $4225 and by paying the minimum it would cost the cardholder $2225 and take five years and five months to wipe.

Increasing repayments to $300 per month would cost only $462 in interest — a saving of more than $1760 and the debt would be paid off in one year and four months.

Other good ways to make hefty savings include reviewing your insurance policies whether it be health, car or home to see what cost-cutting measures can be made, as these policies can vary by hundreds, if not thousands of dollars a year.

Also direct debiting bills can lead to automatic savings and so too can bundling policies.

Credits:

 Sophie Elsworth

Personal Finance Journalist at News.com

www.news.com.au